Bitcoin staged a notable recovery on March 4, pushing back toward the $70,000 level and settling near $68,000 during Hong Kong trading hours.
This upward movement came after a volatile weekend that saw BTC plunge to approximately $63,000, with Middle Eastern geopolitical tensions cited as the primary catalyst.
According to market maker Enflux, the price rebound stemmed largely from forced short liquidations. Bearish traders who anticipated further downside were compelled to close their positions when escalating conflict failed to materialize.
“The market is not pricing catastrophe, but it is not pricing resolution either,” Enflux communicated in correspondence with CoinDesk.
Cryptocurrency markets typically react more swiftly to geopolitical developments than conventional financial markets. Enflux characterized Bitcoin as functioning like a “pressure valve” for capital flows during periods of heightened uncertainty.
Institutional accumulation has emerged as a critical stabilizing force. Bitcoin spot ETFs collectively accumulated approximately $1.45 billion in net inflows throughout the previous five trading sessions.
In a March 2 conversation, Bitwise Chief Investment Officer Matt Hougan revealed that numerous institutional allocators view recent price weakness as an attractive entry point. He referenced one prospective investor who committed $11 million following a two-year evaluation period with Bitwise.
“They’re not surprised that crypto is volatile,” Hougan explained. “They’ve been waiting for an entry point.”
Hougan highlighted that Bitwise’s typical institutional client requires an average of eight meetings before finalizing an allocation, with many conducting reviews only on a quarterly basis. He emphasized that what appears as reluctance often reflects standard institutional due diligence procedures.
As of the fourth quarter, three out of four leading wirehouses now have authorization to proactively present Bitcoin investment opportunities to their client base.
Glassnode analytics indicate gradual improvement, though decisive bullish momentum remains absent.
The Relative Strength Index for Bitcoin climbed to 41 from the previous week’s reading of 36. However, it continues trading beneath the critical 50 threshold that would confirm buyer dominance.
Daily trading volume expanded to $9.6 billion from $6.6 billion, while spot market order flow has achieved greater equilibrium between buyers and sellers.
Futures markets continue displaying seller predominance over buyers, and funding rates for leveraged long positions have declined.
Prediction market data reinforces the cautious sentiment. The likelihood of Bitcoin declining to $65,000 during March decreased by 11 percentage points to 73%. Similarly, the probability of reaching $60,000 dropped 10 points to 41%.
A corresponding Polymarket contract measuring whether Bitcoin touches $60,000 before reaching $80,000 declined 12 points to 61%.
At the time of publication, BTC was changing hands at $66,360.
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